Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,900,000. The project was begun in 2015 and completed in 2016. Cost and other data are presented below: Costs incurred during the year Estimated costs to complete Billings during the year Cash collections during the year Assume that Beavis recognizes revenue upon completion of the project. Required: Compute the amount of gross profit recognized during 2015 and 2016. Assume that Beavis recognizes revenue upon completion of the project. Required: Prepare all journal entries to record costs, billings, collections, and profit recognition. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2015 2016 $ $1,200,000 420,000 980,000 0 450,000 1,450,000 350,000 1,550,000
Beavis Construction Company was the low bidder on a construction project to build an earthen dam for $1,900,000. The project was begun in 2015 and completed in 2016. Cost and other data are presented below: Costs incurred during the year Estimated costs to complete Billings during the year Cash collections during the year Assume that Beavis recognizes revenue upon completion of the project. Required: Compute the amount of gross profit recognized during 2015 and 2016. Assume that Beavis recognizes revenue upon completion of the project. Required: Prepare all journal entries to record costs, billings, collections, and profit recognition. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 2015 2016 $ $1,200,000 420,000 980,000 0 450,000 1,450,000 350,000 1,550,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Beavis Construction Company was the low bidder on a construction project to
build an earthen dam for $1,900,000. The project was begun in 2015 and
completed in 2016. Cost and other data are presented below:
Costs incurred during the year
Estimated costs to complete
Billings during the year
Cash collections during the year
Assume that Beavis recognizes revenue upon completion of the project.
Required:
Compute the amount of gross profit recognized during 2015 and 2016.
Assume that Beavis recognizes revenue upon completion of the project.
Required:
Prepare all journal entries to record costs, billings, collections, and profit
recognition. (If no entry is required for a transaction/event, select "No journal
entry required" in the first account field.)
2015
2016
$ $1,200,000
420,000
980,000
0
450,000 1,450,000
350,000
1,550,000
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